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Dispersed teams can actually outperform groups that are colocated. To succeed, however, virtual collaboration must be managed in specific ways.

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Teams are the typical building blocks of an organization: They provide companies with the means to combine the various skills, talents and perspectives of a group of individuals to achieve corporate goals. In the past, managers used to colocate team members because of the high levels of interdependencies that are inherent in group work. Recently, though, more and more companies are beginning to organize projects over distance, with teams increasingly consisting of people who are based in dispersed geographical locations, come from different cultural backgrounds, speak different languages and were raised in different countries with different value systems.

Over the past 10 years, various studies have investigated the differences in performance of colocated and dispersed teams, quietly assuming that members of the latter never meet in person and members of the former work together in the same office throughout a project. But dispersion is not only a matter of degree; it is also a matter of kind. Most teams are dispersed on some level. They can be spatially separated (from “across the hall” to “scattered worldwide”), temporally separated (spanning different time zones), configurationally uneven (for example, five members in one location and two in another) and culturally diverse. And as past research has repeatedly shown, even the smallest degrees of dispersion, such as working on different floors in the same building, can greatly affect the quality of collaboration.1 In our own study, we have investigated the performance of 80 software development teams with varying levels of dispersion, including those with members in different cities, countries or continents. Such geographically distributed teams have commonly been referred to as “virtual” teams,2 but that label is something of a misnomer, because these groups are very real with respect to the work they can accomplish. We found that virtual teams offer tremendous opportunities despite their greater managerial challenges. In fact, with the appropriate processes in place, dispersed teams can significantly outperform their colocated counterparts.

The Bright and Dark Sides of Dispersion

A team’s level of dispersion is neither preordained nor fixed; rather, it is an organizational design parameter that companies can set and adjust. When making such decisions, managers should take into consideration the various pluses and minuses of separation.

Not surprisingly, several studies have found that collaboration across distance is more difficult than in a colocated environment.

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About the Authors

Frank Siebdrat is a consultant at the Boston Consulting Group in Munich, Germany. Martin Hoegl is a professor and holds the Chair of Leadership and Human Resource Management at the WHU-Otto Beisheim School of Management in Vallendar, Germany. Holger Ernst is a professor and holds the Chair of Technology and Innovation Management at the WHU-Otto Beisheim School of Management.

17 Comments On: How to Manage Virtual Teams

tirian | July 1, 2009

Loved your research and article on virtual teams. We are based in Asia where virtual teams has been a big issue for many years.

When a cross cultural element is added to the mix its even more interesting. As a result we designed a simulation to show participants exactly what happens at work, in front of them as a team that has come together.

We feel this is the best way to get the real issues on the table and start to develop clear & honest communication structures to deal with the issues. We love that you have identified that virtual teams can be in the same building as once we started to run our simulation we discovered that the problems were not just geographical located teams but anyone that does not invest enough face to face time to build trust and allow the benefit of the doubt when dealing with tricky issues.

The best research we found on this topic was from Antarctica so our simulation game is set there (On Thin ICE).

To compliment the corporate research we have also interviewed Antarctic explorers where the peak performance of a virtual team is about life and death. More extreme than corporate but we have discovered that the issues are the same.

Your research supports my many years of experience with dispersed and colocated teams. However, the principles can be boiled down substantially. Yes, processes are key. The principle is to design processes to minimize data latency. Social issues are also important and bringing the team together for a few days as described is crucial. Once people have had a chance to interact on a face to face basis they learn the communication cues characteristic of each other and this makes future communications more effective. Finally, cultural differences must be addressed up front; at the first group meeting if possible. Everyone has to buy into the team goal and into how the team will work. Sometimes this requires that part of the team work in a way that is not part of the team’s normal culture. Discuss approaches to the work sufficiently to uncover such differences and get commitments to follow the teams selected approach. This sometimes takes a strong leader.
Joe Jenney

Mary McGuire | July 2, 2009

Having recently completed a project in Angola where half of the team where located in UK, I can concur with many of the findings in this article.

Team managers that ensured that roles were well clarified, tasks clearly defined and good collaboration across teams brought about considerable performance improvement.

Other teams that we worked with were much less clear about roles and tended to be territorial (them & us) in attitude. Without a doubt the strength and commitment of the team leaders in bridging those gaps is key. One take-away from this research is perhaps the need for multi-nationals to spend more time developing the collaboration skills in their leaders for dispersed team working. Mary McGuire – Agents2change.com

jls1833 | September 20, 2009

Great article. I am very interested in learning more about the socio-emotional processes employers are using to create a sense of team and belonging among dispersed teammates. What specific best practices are being used to bridge gaps caused by short distance dispersion when relocation to the same floor is not an option? I’m also curious about specific practices used by HR partners to effectively engage/support team members in the field. Thanks very much. -Joanna Shepard

mdaffern | April 27, 2010

I define communication as “the right people acting on the right information at the right time” and have found there is a non-linear correlation between the aggregate distance separating team members – be it physically, temporally or culturally – and the necessity for formal communication management. I suggest the early dip in the graph depicting the importance of task-related processes stems not only from an under-appreciation of the need for communication management, but also from an underlying assumption of similarity (of purpose, mind set, etc) by team members who are collocated by site but not necessarily in continuous physical association.

I also would argue the downward trend in performance as dispersion increases results, in part, from the belief a fixeed set of communication management tools and practices is scalable across the range of dispersion. I suggest the authors consider examining if, and how, the teams employ different techniques of management based on the level of team dispersion. As an example, for highly dispersed teams, I’ve found the periodic use of face-to-face meetings involving the whole team can serve to refocus and refine the team’s efforts when placed at the proper junctures in a project’s life. The associated cost becomes a rounding error when compared with the opportunities lost as a result of a late or poorly designed or executed project.

pbrody | May 6, 2010

I managed a variety of dispersed teams at Yahoo and found that the lack of informal, ad hoc interaction was the single biggest issue impacting performance. Absent the informal, interacions it was very hard to create a sense of team. Travel helps, but is never enough.

To address these problems, I founded Sococo (www.sococo.com), a new communication company that lets people work together as if they were in the same physical place. Teams can have scheduled interactions as well as the informal hallway discussions all in a virtual office setting.

Paul Brody SM’93

Hilde Weisert | June 11, 2010

Great article, good comments. Will investigate sococo.
I’m on many dispersed teams and 4 things really help:
1 – using IM chat routinely (1-1, and for ad hoc group chats, to kickoff an ad hoc web session, etc). Use basic stds (post status, use DND as needed, etc). Chat informally from time to time for social connection – it works; use to resolve issues, etc.
2 – the initial face to face can be via TelePresence a good runner up to in person
3 – shared sophistication re teamwork, remote issues – people who are used to colocation can be clueless at first.
4 – clear tasks – Definitely agree. BTW, a great tool for anytime/realtime global collaboration is Mindjet Catalyst – Mindmanager in the cloud, a quantum leap

torpedersen20 | July 7, 2011

Hi,
Thanks for a great article.

I was reading a virtual teams article at http://virtualteamsblog.com which refers to the ratio of how many face to face meetings you should have for ever virtual meetings. It was quite interesting and the blog site has some other interesting articles related to your article above.
– Tor Pedersen

aimsusan | October 6, 2011

This study is very interesting and very aligned with my research and work with virtual teams: http://aim-strategies.com/AIMVTTrendsReport.pdf
In fact, for my current book, A Manager’s Guide to Virtual Teams:http://amzn.to/oEoJXf, research conducted with 150+ virtual managers and members several trends emerged. With teammates dispersed throughout the globe, members had less time boundaries and worked around the clock (52%) and coordinated across time zones (44%). Building the human connection and replacing hallway chats becomes challenging, and even in the virtual environment, occasional face-to-face communication was considered vital for team interaction (particularly during team setup and conflict resolution). Some teams had the luxury of meeting in person while others did not meet at all. I found it interesting that there are so many confirming principles presented in this article that are reinforced my consulting and training experience when working with dispersed virtual teams – whether across the hall, across the state or on the other side of the world.

Thank you professor Frank Siebdrat for sharing your research findings. I do believe “Virtual teams will become as important as Web to companies” in near future. We have done a survey study and published a series of papers on “Virtual teams” and “ virtual R&D teams” which is available on http://ssrn.com/author=1379350 . All in all, we define a new definition for “virtual team” (virtual team “is small temporary groups of geographically, organizationally and/ or time dispersed knowledge workers who coordinate their work predominantly with electronic information and communication technologies in order to accomplish one or more organization tasks”[1]) and found the advantages of employing virtual teams is far from conventional teams.
Nader Ale Ebrahim http://aleebrahim.com/Nader%20Ale%20Ebrahim.aspx

Great article and great tips.
I work as a trainer and make a presentations at the client’s office or remotely from mine. In the second case, it requires less preparation time and costs are reduced of both parties (materials, travel, accommodation), but also the effectiveness of the presentation and the attention of my audience are reduced as well. It’s important for me that the participants of on-line conference will get my materials with the best quality.
It’s not a secret that for those who makes Remote Presentation, Skype is a must have tool. But sometimes just sharing your screen is not effective due to a bad internet connection, so for me is very important that all participant will be able to watch, listen and use in further my documents with no limits.
Mostly I share my mindmaps and projects, I use Conceptdraw software for it. I show my presentations via Skype, it works with Conceptrraw mindmap easy and fast irrespectively the internet speed, because my file is loading to viewers computers and is used by program, not by network. All the participants can view and discuss in same time. Priceless option for distance work.

[…] together, according to authors Frank Siebdrat, Martin Hoegl and Holger Ernst. In their article, “How to Manage Virtual Teams,” good teamwork is on the list of major prerequisites. They emphasize that members of a virtual […]

[…] together, according to authors Frank Siebdrat, Martin Hoegl and Holger Ernst. In their article, “How to Manage Virtual Teams,” good teamwork is on the list of major prerequisites. They emphasize that members of a virtual […]

Hugo Messer | May 21, 2015

Interesting article, I would love to read the full pdf. I think more research and practical experiences should be shared about managing remote teams. It becomes more common every day and managers without experience in handling globally dispursed teams, face challenges they need help with.